Mercer Group reports $962k loss

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Stainless steel manufacturer Mercer Group today reported an annual $962,000 loss, much narrower than loss of $9.35 million reported in the June 2011 year.

The loss of nearly $1m for the year, comprised of a loss of $1.1m in the first half and a profit of $100,000 in the second half, the company said. The company is forecasting strong profit growth for the financial year to June 30, 2013.

Operating earnings before interest, tax, depreciation and amortisation (EBITDA) from the ongoing business for the 2012 financial year of $1.2m was ahead of a target of $1m, excluding abnormals, the company said.

Chief executive Rodger Shepherd said the company had substantially completed a restructuring process and was now concentrating on continuous improvement in its operating divisions as well as searching for adjacent growth opportunities.

Shepherd has taken on the chief executive role as part of a move to restructure the manufacturer, whose key shareholder is Canterbury businessman Humphry Rolleston.

The restructure was detailed at the same time last year's full year results were announced. Performance in the Australian business had been poor and was being cut back, with the Brisbane workshop being closed last year.

Shepherd said in July, Mercer acquired 75 per cent of Titan Slicers, a designer and manufacturer of world-leading industrial slicing equipment.

"Titan is close to finalising a substantial order from a large North American food manufacturer which will have a positive impact on our bottom line," Shepherd said.

During the last six months, Mercer had rebranded and its financial systems upgraded. Offices and distribution centres in the North Island had been moved to new headquarters in Onehunga, Auckland. The company believed its EBITDA for the financial year ended June 30, 2013 would be in the range of $3-4m.

''The company is forecasting capital expenditure of $0.7m and interest expense of $0.3m for the period,'' he said.

The directors had determined that it was not appropriate to pay a dividend this year.